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New Zealand Dollar Technical Analysis: AUD/NZD, NZD/JPY, NZD/USD

New Zealand Dollar Technical Analysis: AUD/NZD, NZD/JPY, NZD/USD

Daniel Moss, Analyst


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New Zealand Dollar, AUD/NZD, NZD/JPY, NZD/USD, Technical Analysis – Talking Points:

  • NZD/USD eyeing a push to key support at the 50-DMA.
  • RSI trend break hints at further downside in the short term for NZD/JPY.
  • AUD/NZD approaching key psychological inflection point. Is a reversal lower in the offing?

The New Zealand Dollar has slipped lower in recent days against its major counterparts, despite its longer-term technical outlook continuing to favour further gains. Here are the key levels to watch for AUD/NZD, NZD/USD and NZD/JPY.

NZD/USD Daily Chart – Psychological Support at 0.7000 in Focus

NZD/USD daily chart created using Tradingview

The NZD/USD exchange rate looks set to continue sliding lower in the short term, after slicing back below the 21-day exponential moving average (0.7153) for the first time since October 2020.

With the RSI snapping the uptrend extending from the March 2020 lows, and the MACD histogram registering its most negative readings in over 4 months, the path of least resistance seems to favour the downside.

A daily close below 0.7100 would likely intensify near-term selling pressure and pave the way for price to challenge the 50-DMA (0.7054).

Clearing that probably ignites a more extensive correction back towards Ascending Channel resistance-turned-support and the December 2020 low (0.7002).

On the other hand, if the 34-EMA (0.7107) remains intact, a rebound back towards the monthly high (0.7315) could be on the cards.

NZD/JPY Daily Chart – RSI Trend Break Ominous for Bulls

NZD/JPY daily chart created using Tradingview

NZD/JPY also appears poised to extend its recent fall from its highest levels since early 2019, after collapsing back below key psychological support at the 74.00 mark.

With price closing below the 34-EMA (73.76) for the first time since November last year, and the RSI breaching the uptrend extending from the September lows, further losses seem in the offing.

Failing to regain a firm foothold above 74.00 could allow sellers to drive the exchange rate back towards Ascending Channel resistance-turned-support and the 73.00 mark. A daily close below that likely opens the door to a challenge of the 100-DMA (71.73).

However, bullish MA stacking suggests that an extended move lower is relatively unlikely. With that in mind, staying constructively positioned above the trend-defining 50-DMA (73.97) could neutralize short-term selling pressure and generate a retest of the 50% Fibonacci (74.24).

Hurdling that probably paves the way for the exchange rate to probe resistance at the 61.8% Fibonacci (75.68).

AUD/NZD Daily Chart – 61.8% Fibonacci Capping Gains

AUD/NZD daily chart created using Tradingview

The AUD/NZD exchange rate has stormed higher since falling to multi-month lows at the start of December, with price climbing over 3.7% higher in the last 7 weeks.

That being said, a near-term pullback to the November high (1.0759) could be on the cards if price is unable to gain a firm foothold above the 61.8% Fibonacci expansion (1.0814) on a daily close basis.

Sliding back below that may ignite a deeper correction back towards the sentiment-defining 200-DMA (1.0711).

Alternatively, hurdling 1.0815 could confluent resistance at the Andrews’ Pitchfork parallel and June 2020 high (1.0881).

-- Written by Daniel Moss, Analyst for DailyFX

Follow me on Twitter @DanielGMoss

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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.